Autumn Statement 2012: By George, we're all in this together

Wednesday 5 December 2012 18:25 BST

Chancellor of the Exchequer Georger Osborne PA

Just nine words had passed the Chancellor’s lips — “It’s taking time but the British economy is healing” — before the cheers and jeers drowned him out. But despite some grim news, Osborne was as bullish as ever.

“Two years ago, Britain was in the danger zone,” he told us — so why, weather aside, do things feel so chilly today?

The guts of this statement were always going to be the Office for Budget Responsibility’s gruesome revised predictions. That explained the Chancellor’s fulsome tribute to the “constitutional achievement” that is independent OBR forecasts. What was remarkable, in other words, was not that the OBR was kicking him but that he had asked them to do so.

Indeed he recounted their explanation for the kicking in some detail: the plunge in this year’s growth — down to -0.1 per cent from 0.8 per cent predicted in March’s Budget — was thanks to “over-optimism regarding net trade”. That feckless eurozone, in other words. Not his fault at all!

Osborne rattled through the grim figures — just two per cent growth even in 2014, and he admitted that he will not meet his 2015 target to get total debt falling.

But the Chancellor is nothing if not a political bruiser, and he was soon flinging hunks of dripping flesh to the Tory backbenchers. Benefits cut with a below-inflation rise of one per cent; a cut in corporation tax; and — to the biggest cheer of the afternoon — a scrapping of the planned fuel duty rise. By the same token, he wasn’t offering much to the Lib-Dems. “We’re not having a new homes tax,” he declared: Nick Clegg permitted himself a shake of the head and a rueful smile at this point. Vince Cable didn’t look happy either, at one point glancing irritably at jovial Eric Pickles.

And the mansion tax wasn’t the Lib-Dems’ only concession: the welfare squeeze will go on into the next Parliament. With a knock-out like that under his belt, Osborne could even permit his great rival, Boris Johnson, a wadge of new cash for a Battersea Tube.

It was not until he announced the cut in pension relief allowance for the rich that he deployed his catchphrase “we’re all in this together”.

The howls of his enemies and the yapping of happy Tories almost drowned him out once more.